Most merchants have likely seen a disclaimer on their monthly credit card processing statements about an upcoming increase in Interchange rates. The card associations (Visa and MasterCard) have announced some significant changes. As you are probably aware there are hundreds of different Interchange categories. During April and October, rates in some categories are increased or decreased, and new categories are created. These Interchange rates are not to be confused with reimbursement fees. I mention this because there are two different rate charts. Reimbursement fees are charged to financial institutions to transfer funds between issuing banks. Yes, the banks pay percentages as well.
Several new categories will take effect October 3rd, 2008. Debt Repayment, Government to Government, and Tax Payment are some of Visa’s new categories.
MasterCard has not announced any major additions yet, but reports say that there will be increases in PIN based debit rate for the Maestro debit network. Grocery and Warehouse merchants will be billed at $0.28 per transaction. Other retail transactions will still be billed at .75% and a 0.175 per item fee. MasterCard is also eliminating QSR and Retail maximum PIN debit rate categories.
I will have more updates on rate increases and decreases in future posts.
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